A combination of AUD strength and Sterling weakness has caused the Aussie to gain by over 5 cents against the Pound in the past month. Upcoming concerns around the US/China trade wars will be a concern for Australia as a commodity based currency despite China's reassurance that they will be immune from any tariffs. The below table shows the difference in AUD you could have achieved when buying £200,000.00 during the high and low points during the past month.
|Currency Pair||% Change||Difference on £200,000|
The AUD has found plenty of support against Sterling of late, making a significant move over recent days.
The AUD has gained over 5 cents in the past month, putting significant pressure on, and even breaking through the 1.80 resistance level during Monday’s trading.
To put that improvement in monetary terms, it would have netted any clients selling 200,000 AUD/GBP an extra £3000.
Some will argue that the AUD’s improvement is a product of Sterling’s demise, rather than any overriding confidence in the AUD. The Pound is under a lot of pressure at present and this has certainly inadvertently boosted the AUD’s value, at least to some extent.
However, this is not the only reason as the AUD had already found plenty of support around 1.85 and still holds the record as the only economy that has avoided a recession for over 26 years.
A report this week indicated the Australian economy continues to rely heavily on immigration, with Australia’s population set to jump from 24 million to 36 million by 2050.
There is a huge demand for skilled workers and this is generally part of the remit to become a citizen via the non-asylum channels. This in turn is likely to create a highly skilled workforce, which should in theory help Australia’s economy to boom over the coming years.
There are some concerns for those clients holding AUD, with global trade fears likely to put some pressure on all commodity based economies.
Whilst their largest trade partner China have already confirmed that Australia will be immune from any tariffs levied on US imports, the ripple effects their trade war could have on the global economy would likely have a detrimental effect on the Australian economy.
Unaffordable housing in Australia’s most affluent cities (Sydney & Melbourne) has also been highlighted as a potential economic destabiliser but for now it seems the problems in the UK are far outweighing those down under.
For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.
From the initial contact with the broker, through my dealings with the compliance folk, the experience was the same, a great blend of efficiency and friendliness, plus I got a great rate, well done Matt and the team.
Matt and Jonathan were excellent and most professional. Through out I felt I was in good hands – they took time to explain everything to me and were very patient when I was experiencing some technical problem with my own bank.
Matt was very helpful and efficient, very good service.